Journal ·
Friday, 10 July 2026
Regime Risk-onMarket regime
Risk-on holds, the fifteenth consecutive read (n=15) and a one-day continuation of the 9 July 2026 print. Vol stays calm: VIX 15.03, inside the quiet band. Breadth firmed to 62.5% (611/977), a comfortable majority above the 50-day EMA and wider than the prior session's read. SPY closed 754.94, +9.0% over its 200-EMA of 692.52. Rates rose on the week but the curve steepened: the 10Y added 5bps to 4.54% while the 2Y lagged at +2bps to 4.16%, widening the 10Y–2Y spread 3bps to 0.38%. Composition points to the discount rate again the real 10Y climbed 5bps to 2.31% against a breakeven pinned flat at 2.23%, so the move was real-rate repricing rather than inflation expectations. Credit went the other way and tightened, HY in 4bps to 2.70%.
Key numbers
| Metric | Level | Read |
|---|---|---|
| Regime | Risk-on | Consecutive print #15, continuation from 07-09 |
| VIX | 15.03 | Calm |
| Breadth >50-day EMA | 62.5% (611/977) | Healthy, firmer than prior read |
| SPY close | 754.94 | +9.0% vs 200-EMA (692.52) |
| 10Y Treasury | 4.54% | week over week +5bps |
| 2Y Treasury | 4.16% | week over week +2bps |
| 10Y–2Y spread | 0.38% | week over week +3bps, steeper |
| 10Y breakeven | 2.23% | week over week flat |
| Real 10Y rate | 2.31% | week over week +5bps, real leg led |
| HY credit spread | 2.70% | week over week −4bps, tighter |
| Fed Funds | 3.63% | as of 1 June 2026 |
| Initial claims | 215K | week over week −2K (as of 4 July 2026) |
| Unemployment | 4.2% | as of 1 June 2026 |
| Nonfarm payrolls | 159.0M | as of 1 June 2026 |
| Housing starts | 1,177K | as of 1 May 2026 |
Regime assessment
The confirms that carry the most weight are intact and, this week, stronger. Credit grinding tighter and vol under the calm threshold both argue for holding cluster-confirmed leaders into a quiet tape, and breadth widening off the prior session's healthy majority adds cushion under any single leader that rolls over. The caveat sits in the curve. The back-up came from the long end and the real leg, the exact pressure point for the longest-duration, highest-multiple narratives that re-rate first when the discount rate climbs; a steepening driven by real rates rather than growth expectations keeps that squeeze live even with the front end anchored. None of it threatens the regime a genuine growth scare would surface in widening credit and collapsing breadth, and both point the opposite way. Positioning holds: keep fresh high-conviction adds tethered to a catalyst or a clean setup, and treat the real-rate drift as the variable that decides which narratives get pressured next.
What would change the call
- VIX at 15.03 sits in the calm band; a snap back above ~18 re-arms the vol gate and tilts the read toward caution.
- Breadth at 62.5% is a healthy majority; participation slipping under 50% flips the regime faster than any single macro print.
- HY at 2.70% just tightened again; a sharp reversal wider strips out the cleanest confirm and drags the read toward neutral.
- The real 10Y at 2.31% rose again this week; a continued climb hits the longest-duration narratives first, breakeven steady or not.
What to watch
- Next CPI against a 2.23% breakeven: a hot print extends the real-rate move that led this week's back-up and pressures duration.
- Labor: claims at 215K (−2K week over week, as of 4 July 2026) stay firm; the test is whether the 159.0M payroll trend and 4.2% unemployment hold into the next release.
- The HY path from 2.70%: whether this fresh tightening sticks or unwinds is the quickest route to re-rating credit.
- Fed path against a 3.63% funds rate, with the curve steepening to 0.38% and the long end leading as the market keeps pricing cuts not yet delivered.
Status
Risk-on since 18 June 2026; consecutive print #15 in the journal, continuation of the 9 July 2026 read. Research only no positions, sizes, entries, stops, or P&L.